Kuala lumpur: Malaysia cannot continue to rely on broad-based subsidies and price controls, and must instead shift its focus towards managing supply, prioritising spending, and reducing dependence on external resources amid ongoing supply constraints, said economist Dr Nungsari Ahmad Radhi.

According to BERNAMA News Agency, the Khazanah Research Institute chairman emphasized that current challenges are primarily driven by supply shortages, particularly in energy and essential goods, rather than price movements. He argued that the real issue lies in the supply chain, stressing the importance of extending existing resources and managing them more effectively.

His comments aligned with earlier statements by Deputy Finance Minister Liew Chin Tong, who advocated for prudent fuel usage to stretch Malaysia's energy buffer beyond June. Nungsari highlighted fiscal limitations and the necessity to reprioritise spending, noting that it is unrealistic to continue spending billions to sustain current subsidy mechanisms.

Nungsari pointed out that Malaysia's limited fiscal space requires policymakers to make challenging trade-offs, such as reallocating existing resources and focusing support on areas most affected, particularly small businesses facing rising operational costs. He also emphasized the need to reduce import dependency, as Malaysia still relies on external sources for critical supplies, including food and energy.

Although there is currently sufficient supply of basic foods like chicken and eggs, Nungsari warned that rising transportation and logistics costs could potentially have a broader economic impact. He underscored the importance of boosting energy efficiency and strengthening domestic production capacity, especially in the food sector, to enhance the country's resilience against future disruptions.